With a total face value of one billion riyals, Abdullah Al-Othaim Investment and Real Estate Development Company successfully completed its first private offering of domestic sukuk denominated in Saudi riyals and compliant with Sharia law this week. The value of orders received exceeded the amount offered for subscription, and the issuance was managed by Saudi Fransi Capital, Al-Ahli Capital, and GIB Capital.
These sukuk were offered in a private placement limited to experienced investors, and the expected yield on the sukuk was set at a spread of 170 basis points added to the Saudi Interbank Offered Rate (SAIBOR) for each semi-annual distribution period.
The company’s Chairman, Fahad bin Abdullah Al-Othaim, explained that the proceeds from these sukuk will be used to finance the company’s projects and expansion plans, as well as for general corporate purposes, and they are due in August 2020. Fahad Al-Othaim emphasized that the successful issuance and full subscription of these sukuk at the targeted value and yield reflect the company’s strong financial and credit position, as well as investors“ confidence in it, as the offering attracted interest from major investors, including banks, insurance companies, government entities, investment funds, and other large corporations.
Fahad Al-Othaim thanked everyone who contributed to the success of the offering, including the underwriters, legal advisors, certified public accountants, and company employees. He also extended special thanks to the sukuk holders for their trust in the company and their investment in it.
It is worth noting that Abdullah Al-Othaim Investment and Real Estate Development Company is one of the leading companies in the development and operation of shopping centers and family entertainment centers. It currently operates five large malls in the Kingdom and 16 family entertainment centers, and plans to open three new malls early next year and two more before the end of 2016, It also plans to open 15 new entertainment centers by the end of 2016, most of which are located outside the Kingdom in countries such as the UAE, Egypt, and Qatar. The company also has a nascent restaurant and café division that it intends to expand soon.
